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Infrastructure News - April 2006

Report: Chicago Highway Bottlenecks Among Worst Nationwide


A January 2006 Federal Highway Administration report shows that Chicago has one of the worst highway interchange bottlenecks in the nation.

In addition, the report finds that the nation overall is experiencing a freight transportation capacity crisis that increasingly threatens the strength and future productivity of the U.S. economy.

The FHWA report, "An Initial Assessment of Freight Bottlenecks on Highways," found bottlenecks are causing truckers 243 million hours of delay annually. At a direct user cost of $32.15 per hour, the delay from bottlenecks is costing trucking companies nearly $8 billion annually, the report said.

The study analyzed four major types of highway freight bottleneck delays: highway interchanges, signalized intersections, steep grades and lane reductions.

Ranked by annual hours of delay for all trucks, Chicago is one of the top cities for highway interchange bottlenecks, in addition to Atlanta, Phoenix, Los Angeles and Buffalo-Niagara Falls, N.Y.

Overall, bottlenecks represent 40 percent of all congestion delays, followed by traffic incidents (25 percent), bad weather (15 percent), work zones (10 percent), poor signal timing (5 percent) and special events (5 percent).

Without major capacity investments, FHWA estimates "that by 2020, 29 percent of urban National Highway System routes will be congested or exceed capacity for much of the day and 42 percent of National Highway System routes will be congested during peak periods."

By comparison, the agency said, only 10 percent of the urban National Highway System routes were congested in 1998.




Bush Budget Cuts Funding For Transit, Airports

President Bush's proposed $2.77 trillion federal budget would cut funding for transit and airport programs but boost highway spending, an analysis by the Washington, D.C.-based American Road & Transportation Builders Association shows.

The proposal calls for federal transit investment of $8.88 billion, but this amount is $100 million below the FY 2007 funding level guaranteed by Safe Accountable, Flexible and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU).

In addition, the Administration's budget recommends a $765 million, or 22 percent, reduction in federal airport construction investment from the current level of $3.52 billion.

On the upside, the proposal recommends record funding for a number of federal transportation programs, including a $3.4 billion boost in federal highway investment.

While a more than $2 billion FY 2007 highway funding increase was called for by the Safe Accountable, Flexible and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU), an additional $842 million is recommended in the budget due to Highway Trust Fund Highway Account revenues that exceeded SAFETEA-LU's estimates.

The Administration's budget proposal is not binding but rather represents the first step in the annual budget process. Federal spending decisions for each fiscal year are not finalized until the enactment of the 12 individual appropriations bills.





Study: Delays in Permit Approvals Cause Millions in Lost Revenue

Communities with an efficient building permitting process can gain millions of dollars in tax revenues and significantly bolster their economic development, a study finds.

The study, which the Washington, D.C.-based American Institute of Architects released, concluded that the implementation of a responsive permit process over a five-year period could result in a 16.5 percent increase in property taxes and a 5.7 percent increase in construction spending.

The report, "The Economic Impact of Accelerating Permit Processes on Local Development and Government Revenues," presents calculations assuming three-month acceleration in total development time. It focuses on nonresidential projects that accounted for $295 billion in new investment in 2004, according to the Department of Commerce.

"Within the last five to ten years, there has been a substantial increase in delays in building permit approvals," said AIA Chief Economist Kermit Baker.

Highlights of the report include the following:

  • A three month acceleration in permit approval on a 22-month project cycle would make a project more financially attractive and could determine whether the project is undertaken at all

  • Higher rents for all tenants are caused by permitting delays Improving permit processes can attract investment from areas outside a local community

  • Accelerating the permitting process can permanently increase local government revenues. Increasing construction spending caused by more efficient permitting processes will provide broader economic benefits.

    Prior to the recent U.S. Conference of Mayors meeting, the report was sent to 1,000 mayors, local building permit officers, city council members and local municipal and county officials.

    The full report can be read by visiting www.aia.org/SiteObjects/files/permitstudyfullreport.pdf on the Internet.
    New York-based accounting firm PricewaterhouseCoopers LLP performed the study.




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